Foreign Capital Enters the Field of Auto Parts

Chinese Auto Parts Market Problem

The auto parts market in China is corresponding to the automotive service industry, in the future profit distribution of automobile industry, spare parts market will be the new car market and other relatively profit split. However, seen from the present development of the current situation of China auto parts market, there are at least three levels of problems. First, in the auto parts market, although the number of parts of our own industry are various, but still some are fully missing in the existing parts of auto accessories market, such as the airbags are almost all import auto accessories, our country still needs to import large quantities of such products; Second, the market share of the allocation of the parts market in China has regional pattern, and we can even say that a group class vehicle manufacturing area contains numerous auto parts manufacturers, this is a enormous waste of market resources; Third, the research and development capabilities of fatigue lead to the situation that auto parts enterprises in China are difficult to grasp market opportunities, and the lack of core competitiveness resulting in the fact that business expansion is limited.

car lighting

The Cause of Auto Parts Market Problem

The problem has a fundamental reason is that China’s auto market has not really open, independent brand car manufacturer has not integrated file for the industry chain integration in accordance with the State Council. Seen from market integration scenarios that we learned part of the Hebei auto parts market, auto parts market in other regions do not form a large-scale consolidation trend still continues, even the enlargement of trade barriers, Zhejiang lead to the parts market in China is difficult fully release market potential, domestic expansion is more difficult to get out of the market. However, this phenomenon is expected to break by the sudden invasion of foreign capital.

Influence of Foreign Capital Invasion to China’s Auto Parts Industry

On the one hand, we believe that the invasion of foreign capital has a certain degree of blow to the domestic car lighting kits enterprises. For example, foreign investment in the coastal markets will be the first time to use technology and financial advantage for expansion and it is expected to form a competitive advantage in the 5-10 years and to carve up the regional market, China’s domestic parts manufacturers are relatively difficult to obtain market competitive dynamics. The other hand, the foreign capital invasion will also bring some good news for China’s auto parts enterprises development. Of profit from integrated joint venture will draw on broad imitate the technology platform and benefit will be the development of parts industry in China.

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